Healthcare-Agency Deficit Faces Further Expansion

The New York City Health and Hospitals Corp., the country’s largest municipal healthcare organization, faces a $430 million deficit that could balloon by hundreds of millions of dollars more, depending on the outcome of labor talks, its president said.

In testimony Thursday before the City Council, Alan Aviles, who is stepping down later this month after nine years as president, said the organization’s financial plan doesn’t contain funding for retroactive raises for employees.

Retroactive raises for employees represented by 1199SEIU Healthcare Workers and the New York State Nurses Association, , for example, could be as much as $350 million this year and an additional $87 million per year going forward, Mr. Aviles said.

“Even with our best efforts,” Mr. Aviles testified, “the size of the gaps we face will likely result in the need for additional cost containment actions or significant increases in city support in order for HHC to balance its budget.”

Mr. Aviles testified that the corporation may consolidate services to save money, and he later told reporters that staffing could also be reduced, though he didn’t expect any cuts to staff in the immediate future. The corporation’s deficit is expected to be nearly $1.4 billion in the fiscal year beginning July 1, 2017.

Mr. Aviles’ successor, Dr. Ramanathan Raju, the head of Chicago’s public hospital system, takes over March 31.